President Trump has restarted efforts to remove Federal Reserve Governor Lisa Cook, following a Supreme Court ruling that blocked his earlier attempt. A letter sent to Cook by the White House, signed by Deputy Chief of Staff Dan Scavino, claims she committed actions that could lead to criminal charges and questioned her trustworthiness. Cook’s legal representative responded by saying there is no valid reason to remove her from her role at the central bank. The lawyer added that they will continue to defend Cook’s position and the independence of the Federal Reserve.
This is not the first time Trump has tried to oust Cook from her post, as he previously cited mortgage fraud in his effort, according to Staradvertiser. Cook rejected those claims and said they were used to silence her due to disagreements over monetary policy decisions.
The Supreme Court ruled in June that Trump could not fire Cook, which preserved the central bank’s independence from presidential interference. The court’s decision was a 5-4 vote, with conservative Chief Justice John Roberts writing the opinion. Roberts said Trump had not given Cook the procedural protections required by law before attempting to remove her. The ruling did not determine whether Cook actually committed the alleged acts, but it did uphold that she had a right to respond.
The case was sent back to lower courts for further review, leaving the factual issues unresolved. Roberts noted that Cook’s removal would be based on a pretext, using mortgage fraud as an excuse to remove her. He also said it is unclear if the charges against Cook are strong enough to justify firing her under federal law.
The letter sent by Scavino refers to allegations made by Federal Housing Finance Agency Director William Pulte. Pulte had previously asked the Justice Department to investigate Cook and others over mortgage fraud claims from years ago.
No criminal investigation has been announced, despite the earlier calls for one. Cook had listed one of the homes involved as a vacation property in her filings to lenders. A local tax authority in Michigan confirmed that she did not violate any rules by listing the home as her primary residence.
Legal experts say the allegations may not meet the standard needed to remove a Fed governor under current laws. Roberts did not agree with that view, but said the standard for removal must still be high and require a strong basis. He emphasized that Cook should have been allowed to respond to the accusations before any action was taken.
The Supreme Court’s decision is seen as a strong defense of the Fed’s independence from political pressure. This marks the first time since the central bank’s founding in 1913 that a president has tried to fire a Fed governor.
Trump has also criticized former Fed Chair Jerome Powell for not lowering interest rates as requested. His choice to replace Powell, Kevin Warsh, has not yet made the rate cuts Trump wants. Trump has redirected his criticism toward other Fed members, most of whom were appointed by President Biden.
Cook’s legal team said the president’s actions are not based on legitimate grounds and that they will continue to fight, according to a report from Yahoo News. They also pointed out that the Supreme Court already ruled against Trump’s first attempt to remove Cook.
Cook herself said she was not being forced out due to a tweet from Pulte about a past mortgage issue. She emphasized that she would not step down under pressure from political claims.
The situation remains unresolved, with Cook’s legal team preparing for further court proceedings.
IMAGE: Members of the Board of Governors of the Federal Reserve System after swearing in ceremony on May 23, 2022. Learn more: <a href=”https://www.federalreserve.gov/aboutthefed/bios/board/default.htm” rel=”noreferrer nofollow”>www.federalreserve.gov/aboutthefed/bios/board/default.htm</a>. Photo: Federalreserve / Wikimedia, taken 2022-05-23, Public domain
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